Frankfort looks to attract new industrial developers
By Susan DeMar Lafferty email@example.com November 8, 2013 8:16PM
Updated: November 8, 2013 8:50PM
Frankfort has added another incentive into its economic development trick bag – one designed to attract industrial users to the village.
The village has successfully employed a low-interest loan program and a retail grant program in its historic downtown area, and on Monday, trustees approved offer grants up to $25,000 to encourage industrial developers.
Frankfort is not known for its industrial base, and has had “zero” industrial permits in the last few years, village administrator Jerry Ducay said in a recent economic development committee meeting.
“When you look at balancing the tax base, we are falling behind on industrial property,” he said.
Currently, less than 3 percent of Frankfort’s property valuation is industrial, down from 12 percent in the late 1980s. Since then, residential growth outpaced commercial and industrial growth, village planner Jeff Cook said.
The industrial incentive grant program is three-tiered. It would offer $1 per square foot, up to a maximum of $25,000 for a newly constructed industrial building that is at least 10,000 square feet.
Those who build out or expand existing sites can apply for grants for up to $15,000 or 25 percent of the cost of qualified improvements, which ever is less, for target industries, such as medical and health care related services, businesses services or manufacturing. Grants up to $10,000 will be available to non-targeted industries, such as light manufacturing, warehouses, or equipment and supply businesses.
The village has huge swaths of agricultural land zoned for industrial use and a number of existing buildings and existing one to two-acre lots available for any number of businesses, Cook said.
Village officials acknowledged that Frankfort’s building standards are high which make construction more expensive, but they said they hope this latest incentive will make developers notice Frankfort.
“It also says Frankfort welcomes industrial developers which is a message we have not gotten out in the past,” Ducay said. “This will not open the flood gates. We are not a prime area for this. At our peak, we have seen three to five new industrial permits in a year. If we get two buildings a year, this program will be a success.”
Industrial developer Larry Fey, who owns industrial-zoned lots on Laraway Road in Frankfort, told officials in a recent committee meeting, “Anything will help. This may get us over the hump.”
He said he has tried to lure industrial users out of Cook County, where property taxes are higher, but said Frankfort’s fees and fire safety requirements (sprinklers are required in all buildings over 3,000 square feet) make development here “expensive.”
This new industrial incentive program is “a start,” Mayor Jim Holland said. “We want to give developers something to talk about that has meaning to it.”
Since it began the low interest program in 2009, the village has approved 14 applications, and is now considering one for $34,250 for the redevelopment of the former Harris Bank building at 28 W. Nebraska, which will be the back office for autoaccessoriesgarage.com, whose president Steve Therriault is a Frankfort resident.
In this program, the village buys down three percent of the interest rate on the first $200,000 of a bank loan. Money can be used for façade or structural improvements or fire safety, but 50 percent of the improvements must be exterior, Ducay said. The village pays the bank directly.
The retail grant program — initiated in 2009 — has provided 10 grants of up to $10,000 to those who operated a new business in the historic downtown area and made a three-year commitment.
Ducay said village officials are always looking for creative ways to offer incentives without taking away from other taxing districts, such as school, park and library districts.